Nintendo FY3/2016 Financial Results Briefing, Part 7: Smart Device Business

“We are working to provide a high-quality experience optimized to smart devices.”

☆ NintendObs Event – Nintendo FY3/2016.

Next, I will explain our progress in the smart device business.

I have explained this on some occasions in the past as well, but Nintendo’s smart device business has three purposes.

First, we want to use smart devices to maximize the number of people who come into contact with Nintendo IP.

Next, of course we aim for the smart device business to be profitable on its own.

Furthermore, we want to create synergy with the dedicated video game system business to realize the full potential of our entire business.

We have placed no restrictions on which Nintendo IPs can be developed for smart devices, so we continue to discuss the best ways to bring various characters and worlds to smart devices.

We understand that the value of the Nintendo characters and game titles that our consumers have supported for so long comes from the treasured experiences of playing on Nintendo’s game systems, and the “hand-crafted” feel emblematic of Nintendo’s products. It is not just a matter of character popularity.

This is why we feel that it would be a mistake to simply release our game titles in their current form on smart devices.

Therefore, we are carefully selecting IPs that will provide the consumers with strong value suitable to smart devices. We are working to provide a high-quality experience optimized to smart devices.

To kick off this new business, Nintendo recently released our first application for smart devices, Miitomo.

In Miitomo, the user creates a character likeness called a Mii that sparks conversations with the user’s friends on a wide range of topics, letting you discover things you never knew about your close friends. This is a unique application focused on communication.

Service began first in Japan on March 17th, and expanded to 15 more countries worldwide, including the U.S., on March 31st. We currently offer service in 16 countries and 8 languages.

I have heard that it is unprecedented for a company making its first foray into the smart device business to support so many countries and languages at such an early stage.

As a result of our global efforts, consumers worldwide are enjoying Miitomo. We have already passed 10 million unique users at present.

On top of the number of the unique users, the number of conversations exchanged within Miitomo has exceeded 300 million. In addition, the “Miifoto” functionality allows users to create unique pictures with their Mii, and users have already created more than 20 million of these pictures.

* The number of Miifotos excludes those taken automatically by the application and counts only Miifotos that the users have created themselves.

Miitomo aims for further expansion in the future, with plans for regular updates and extension of service to additional countries. We are considering possibilities for launching service in South America and Asia.

Through this support, we expect Miitomo to play an even bigger role on the global stage as the forerunner of Nintendo’s new business activities.

Yesterday, we announced that we will follow Miitomo with Fire Emblemand Animal Crossing, two new applications based on our IPs, as the next steps in our smart device business.

We will provide more details about these applications closer to the launch period, but I will provide a brief description of both of them today.

The first IP is Fire Emblem.

Fire Emblem is a pioneering role-playing simulation game series, combining the tactical elements of a simulation game with the character customization elements of a role-playing game.

It is also well known by the catchphrase “tough-to-beat simulation.” This high-quality simulation game depicts intense battles in a sword-and-sorcery world inhabited by unique and charming characters, making it well-loved by fans.

Fifteen titles have been released in this series, from Fire Emblem: Ankokuryu to Hikari no Ken (Japanese title) in 1990 to the latest title,Fire Emblem Fates.

This series has many passionate fans, particularly among gamers in their 20s and 30s.

As I mentioned before, the latest title, Fire Emblem Fates, is selling well in America and has found a wide audience outside of Japan as well.

We have also released many spin-off titles and related products, and this has become a major IP for Nintendo, both in name and in substance.

We are currently developing an application for smart devices based on Fire Emblem.

We expect that many consumers will experience Fire Emblem for the first time on their smart device, so this application will offer a more accessible style of gameplay compared to the titles for dedicated video game systems. At the same time, we still aim to provide a fully engaging experience as a role-playing simulation game.

Next, I will discuss Animal Crossing. Animal Crossing is another one of Nintendo’s most beloved IPs.

In the Animal Crossing series, your avatar is the main character and you can live as you please, experiencing life in real time and enjoying events across all four seasons with delightful animal companions.

The unique and lovable characters, relaxed lifestyle, and endless playability make this series popular with female and young consumers in particular.

Both Animal Crossing: Wild World for Nintendo DS and Animal Crossing: New Leaf for Nintendo 3DS have each sold more than 10 million copies globally.

The series has been loved since its debut in 2001, and has become one of our evergreen software titles.

We are currently developing a new application for smart devices based on the characters and world of Animal Crossing.

As I mentioned before, the Animal Crossing series for dedicated video game systems is well-loved for its long-term playability, so we want to offer a connection between the smart device application and the world of Animal Crossing on dedicated video game systems. This will make it even more fun to play in both ways, while offering a new style of play for smart devices.

We are developing this application to provide consumers with strong value suitable to smart devices while also generating synergy with our dedicated video game system business, as this is one of the goals of our smart device business.

We plan to release both of these applications in fall 2016.

Both of these are pure game applications. Compared to Miitomo, they have more prominent game elements, so consumers will be able to play as they like, and the game content will connect to our business.

As for Miitomo, our first priority was to bring more consumers around the world in contact with Nintendo entertainment. Items are available as in-game purchases for consumers who want to deepen their experience, but we have designed Miitomo so that it is possible to have plenty of fun enjoying this new mode of communication even without making in-game purchases.

As a result, users are enjoying Miitomo across the globe, with over 75% of users outside of Japan at present.

We expect this percentage to rise even higher in the future as we consider service expansions to South America and Asia.

We believe this shows that Nintendo has made real progress in advancing our smart device business on a global scale.

We will follow Miitomo by releasing new applications using the Fire Emblem and Animal Crossing IPs globally, and our plan has not changed in terms of releasing around five titles by March 2017.

— Tatsumi Kimishima, President of Nintendo
Source: Nintendo JP, Nintendo JP, Nintendo JP.